Week Ahead

The BSE Sensex jumped over 500 points to 65,387, and the Nifty50 climbed 170 points to 19,435 as most sectors, barring FMCG, closed in the green. The broader markets fared much better than benchmarks, with the Nifty Midcap 100 and Smallcap 100 indices rising 2.5 percent and 4.4 percent.

In the week beginning September 4, the market may trade within a range and in consolidative mood with more stock-specific action, given the ongoing momentum in broader markets.

Further, in the absence of any major triggers from the domestic market, the sentiments would be driven by global cues, including the release of US payroll and PMI data.

The Nifty50 has taken a good support at 19,250-19,200 levels in last several days, which is expected to be sacrosanct support going ahead too, as breaking of the same can drag it down to 19,000-18,900 levels.

Technically index has formed bullish candlestick pattern which resembles Bullish Engulfing kind of pattern formation on the daily charts, raising hopes for further rally in coming sessions, while on the weekly basis, the index has also formed green candle after Inverted Hammer pattern in previous week, which generally considers as a trend reversal pattern, which came true in the passing week. Hence, the 19,450-19,500 area is crucial next week for further recovery and if the index surpasses and sustains above 19,650 mark in coming days then can raise confidence among participants about further positive momentum towards 19,800, but till then rangebound activity will continue.

The Option data indicates that 19,500-19,600 is expected to be resistance area in coming days, with critical support at 19,300-19,200 levels.